Higher Prices, Strong Demand Drive Birkenstock to Record Sales in Q1
Birkenstock reported record revenue in the first quarter of 2024, driven by full price sell-throughs and strong demand for its products across all regions, channels and categories.
On Thursday, the 250-year-old German footwear brand reported that net revenues rose 22 percent to 302.9 million euros ($328.5 million at current exchange) in the first quarter, up from 248.5 million euros ($269.4 million) the same time last year.
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By region, Birkenstock said that revenue grew across all regions, netting an increase of 19 percent in the Americas, 33 percent in Europe and 51 percent in Asia Pacific, Middle East and Africa (APMA). Direct-to-consumer revenue in the quarter increased 30 percent, driven by above-industry average full price realization, while wholesale revenue grew 22 percent in the period, propelled by high sell-through rates.
The company also reported a net loss of 7.15 million euros in the first quarter of 2024, or a loss of 4 euro cents per share. That’s down from a loss of 9.19 million euros, or a loss of 5 euro cents per share the same period last year. Excluding one-time items, Birkenstock reported a profit of 17 million euros or 9 euro cents per share in Q1.
Birkenstock chief executive officer Oliver Reichert said in a statement that the company’s first quarter results demonstrate the “resilience” of its business model and the “strong sustained demand” for its products.
“Given our engineered distribution model, demand continues to outpace supply in all regions, channels and categories,” Reichert said. “As previously communicated, our strategic investments into future growth are having a planned, temporary impact on our profitability. However, in the medium-term, we are confident we will continue to deliver our objectives of a gross profit margin over 60 percent and an adjusted EBITDA margin in the low thirties percent.”
Looking ahead, the company said it expects that its investments in production capacity expansion will enable the company to more effectively meet the consumer demand for Birkenstock products. Additionally, the company continues to carefully track costs on the sourcing and production side to contain inflation, with partial mitigation through executed, selective price increases, Birkenstock noted in its earnings statement.
For the full fiscal year, Birkenstock expects 2024 revenues of between 1.74 billion euros to 1.76 billion euros, which would represent growth between 17 percent and 18 percent compared to 2023.
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